Common use of Minimum Advance Royalty Clause in Contracts

Minimum Advance Royalty. Immediately upon the sale of the leased minerals, if such sale occurs on the lease premises, or the removal of the leased minerals in commercial quantities from the leased premises, LESSEE shall pay in the same manner prescribed in Section 28 of this lease a sum of Five Hundred Thousand and No/100 Dollars ($500,000.00) as minimum advance royalty. This Section 4 shall not apply to the production of waste materials as defined in Section 14(g). The payment of the initial minimum advance royalty shall be considered timely if it is received by the COMMISSIONER, at Austin, on or before seven (7) days after the date of the initial commencement of production. Thereafter, this royalty is to be so paid and received on or before the anniversary date of this lease, in advance, for each lease year (as determined by the anniversary date of this lease) in which the leased minerals are produced from the leased premises. It is understood and agreed that this minimum advance royalty is due and payable for every year that the leased minerals are produced from the leased premises, regardless of the amount of actual production. Should LESSEE cease production and later re-commence production, then payment of a minimum advance royalty shall be due and payable immediately upon re­commencement of production in the same manner as if LESSEE were initially commencing production. However, should LESSEE so re-commence production within the same lease year for which a minimum advance royalty has already been properly paid to the COMMISSIONER, then a payment shall not be due upon the re­ commencement but shall be due and payable thereafter by LESSEE in the manner described above on or before the anniversary date of this lease, in advance, for each lease year in which the leased minerals are produced from the leased premises. If applicable, a minimum advance royalty paid will be credited against the first royalty due as hereinafter provided for the leased minerals actually produced from the leased premises during the lease year for which such minimum advance royalty was paid.

Minimum Advance Royalty. Immediately upon the sale commencement of the leased minerals, if such sale occurs on the lease premises, or the removal production of the leased minerals in commercial quantities from the leased premises, LESSEE shall pay in the same manner prescribed in Section 28 32 of this lease a sum of Five Hundred Thousand and No/100   Dollars ($500,000.00  ) as minimum advance royalty. This Section 4 shall not apply to the production of waste materials as defined in Section 14(g13(g). The payment of the initial minimum advance royalty shall be considered timely if it is received by the owner of the soil and the Commissioner of the General Land Office of the State of Texas, (herein referred to as "COMMISSIONER"), at Austin, on or before seven (7) days after the date of the initial commencement of production. Thereafter, this royalty is to be so paid and received on or before the anniversary date of this lease, in advance, for each lease year (as determined by the anniversary date of this lease) in which the leased minerals are produced from the leased premises. It is understood and agreed that this minimum advance royalty is due and payable for every year that the leased minerals are produced from the leased premises, regardless of the amount of actual production. It is further understood and agreed that this minimum advance royalty is not indicative of or a substitute for production in paying quantities and that said royalty in no way affects the term of this lease. Should LESSEE cease production and later re-commence production, then payment of a minimum advance royalty shall be due and payable immediately upon re­commencement re-commencement of production in the same manner as if LESSEE were initially commencing production. However, should LESSEE so re-commence production within the same lease year for which a minimum advance royalty has already been properly paid to the COMMISSIONERpaid, then a payment shall not be due upon the re­ re-commencement but shall be due and payable thereafter by LESSEE in the manner described above on or before the anniversary date of this lease, in advance, for each lease year in which the leased minerals are produced from the leased premises. If applicable, a minimum advance royalty paid will be credited against the first royalty due as hereinafter provided for the leased minerals actually produced from the leased premises during the lease year for which such minimum advance royalty was paid. The minimum advance royalty payments made under this section covering any period of time after the fifth anniversary of this lease shall be adjusted based on the percentage change in the "Producer's Price Index for All Commodities" (Base year 1982 = 100) as published by the Bureau of Labor Statistics, U.S. Department of Labor, (or its successors), as follows: If this change quotient is positive, then: [1 + the positive change quotient] x [last due minimum advance royalty] = adjusted minimum advance royalty due. If this change quotient is zero, then: the adjusted minimum advance royalty due shall be due in the same amount as the last due minimum advance royalty. If this change quotient is negative, then: [last due minimum advance royalty] + [negative change quotient x last due minimum advance royalty] = adjusted minimum advance royalty due. However, in no event shall any minimum advance royalty due under this lease be less than the     Dollars ($  ) set out above.

Minimum Advance Royalty. Immediately upon the sale of the leased minerals, if such sale occurs on the lease premises, or the removal of the leased minerals in commercial quantities from the leased premises, LESSEE shall pay par in the same manner prescribed in Section 28 of this lease a sum of Five Hundred Fifty Thousand and No/100 Dollars ($500,000.0050 000.00) as minimum advance royalty. This Section 4 shall not apply to the production of waste materials as defined in Section 14(g). The payment of the initial minimum advance royalty shall be considered timely if it is received by the COMMISSIONER, at Austin, on or before seven (7) days after the date of the initial commencement of production. Thereafter, this royalty is to be so paid and received on or before the anniversary date of this lease, in advance, for each lease year (as determined by the anniversary date of this lease) in which the leased minerals are produced from the leased premises. It is understood and agreed that this minimum advance royalty is due and payable for every year that the leased minerals are produced from the leased premises, regardless of the amount of actual production. Should LESSEE cease production and later re-commence production, then payment of a minimum advance royalty shall be due and payable immediately upon re­commencement re- commencement of production in the same manner as if LESSEE were initially commencing production. However, should LESSEE so re-commence production within the same lease year for which a minimum advance royalty has already been properly paid to the COMMISSIONER, then a payment shall not be due upon the re­ re- commencement but shall be due and payable thereafter by LESSEE in the manner described above on or before the anniversary date of this lease, in advance, for each lease year in which the leased minerals are produced from the leased premises. If applicable, a minimum advance royalty paid will be credited against the first royalty due as hereinafter provided for the leased minerals actually produced from the leased premises during the lease year for which such minimum advance royalty was paid.

Minimum Advance Royalty. Immediately upon the sale commencement of the leased minerals, if such sale occurs on the lease premises, or the removal production of the leased minerals in commercial quantities from the leased premises, LESSEE shall pay in the same manner prescribed in Section 28 27 of this lease a sum of Five Hundred Thousand and No/100 Dollars ($500,000.00$ ) as minimum advance royalty. This Section 4 shall not apply to the production of waste materials as defined in Section 14(g13(g). The payment of the initial minimum advance royalty shall be considered timely if it is received by the COMMISSIONER, at Austin, on or before seven (7) days after the date of the initial commencement of production. Thereafter, this royalty is to be so paid and received on or before the anniversary date of this lease, in advance, for each lease year (as determined by the anniversary date of this lease) in which the leased minerals are produced from the leased premises. It is understood and agreed that this minimum advance royalty is due and payable for every year that the leased minerals are produced from the leased premises, regardless of the amount of actual production. Should LESSEE cease production and later re-commence production, then payment of a minimum advance royalty shall be due and payable immediately upon re­commencement re- commencement of production in the same manner as if LESSEE were initially commencing production. However, should LESSEE so re-commence production within the same lease year for which a minimum advance royalty has already been properly paid to the COMMISSIONER, then a payment shall not be due upon the re­ re- commencement but shall be due and payable thereafter by LESSEE in the manner described above on or before the anniversary date of this lease, in advance, for each lease year in which the leased minerals are produced from the leased premises. If applicable, a minimum advance royalty paid will be credited against the first royalty due as hereinafter provided for the leased minerals actually produced from the leased premises during the lease year for which such minimum advance royalty was paid.